Scottish Business Briefing - Thursday 18 June, 2009

Published on Thursday 18 June 2009 09:28

WELCOME to scotsman.com's Scottish Business Briefing. Every morning we bring you a comprehensive round-up of all news affecting business in Scotland today.

ECONOMY

One British worker loses job every 30 seconds

ALISTAIR Darling said last night that Britain appeared to be on the road to recovery, despite new figures showing that a job was lost every 30 seconds over the past three months (Scotsman). The Chancellor said in his annual Mansion House speech to the City that there was "growing evidence" that the action taken around the world to stabilise banks and support economies was beginning to work. But his speech came just hours after figures revealed that unemployment had risen to a level not seen since Labour came to power in 1997. The 2.26 million unemployed include a rising number of white-collar workers.

Read all today's economics news from scotsman.com

BANKING & INSURANCE

HSBC to take on Scotland's corporate banking giants

BANKING giant HSBC has unveiled ambitious plans to boost its operations north of the Border in a move that will see it gearing up to take on Scottish rivals in the corporate banking market (Scotsman). The plans to step up the pressure on the established Scottish banks was revealed yesterday by the newly appointed Scotland chief executive of Britain's biggest bank. Speaking on the day of his appointment, John Rendall revealed HSBC's strategy to further expand its business banking team. He also promised to open additional retail branches north of the Border.

Governor seeks more bank powers

The governor of the Bank of England has called for greater powers to allow it to fulfil its new role of promoting financial stability. In a major speech in London, Mervyn King said the Bank could no longer act "like a church" whose congregation "ignores its sermons" (BBC). His remarks appeared to be at odds with those made earlier by the chancellor. Alistair Darling told the same event he had no plans to fundamentally change the current system of regulation. At present, oversight is carried out jointly by the Treasury, Bank of England and Financial Services Authority. But Mr King, delivering the annual Mansion House speech, said the major lesson of the financial crisis was that these authorities lacked the means to take effective action to prevent excessive risk taking at banks.

Read all today's banking news from scotsman.com

INDUSTRY

Dawson spins an 8.4m deal for yarn arm

CASHMERE group Dawson International yesterday announced it has sold its lossmaking yarn business to a major Chinese supplier in a deal worth about 8.4 million (Scotsman). Dawson's 140-year-old Todd & Duncan cashmere yarn spinning arm, which employs 200 in Kinross, will be taken over by Zhongyin Cashmere, which is based in Ningxia. Zhongyin has been a major supplier of cashmere fibre to Todd & Duncan for five years. The deal also involves a four-year supply agreement, which will see the Chinese firm continue to sell yarn and garments to Dawson's couture knitwear business Barrie and its American division, Dawson Forte.

Tullis profits add up on paper

FAVOURABLE exchange rates and price hikes helped Tullis Russell, the employee-owned paper maker, to today post a 20 per cent rise in full-year operating profit (Scotsman). The Glenrothes-based group – which also owns paper coating factories in Macclesfield and South Korea – made an operating profit of 1.63 million, on the back of a 6 per cent rise in turnover to 153m. Tullis Russell said a "strict pricing discipline", which involved raising prices during the first quarter of its financial year, and favourable movements in foreign exchange rates had helped to offset rising energy and raw material costs. All 740 members of staff are shareholders and received a share in a 600,000 profit- related bonus pot, along with a further 150,000 in dividends.

Scots firm to build homes in devastated Italian city

Powerwall Systems, the futuristic construction services group based in Wishaw, yesterday told The Herald it had struck a 35m-plus deal to build around 800 earthquake-proof homes in the devastated city of L'Aquila in central Italy, much of which was reduced to rubble after a series of devastating tremors in April. Powerwall, which is one of Scotland's premier mid-sized engineering and construction companies and one of the few to exhibit confidence amid a recession that crippled the sector, yesterday said it had struck a joint venture deal with an unnamed Italian company to replace many of the homes destroyed in the earthquake.

Read all today's industry news from scotsman.com

Scotsman Business Club

Get to the heart of the issues affecting Scottish business at www.scotsman.com/businessclub. Features include blogs from The Scotsman's formidable team of business writers - including Bill Jamieson, Martin Flanagan, Peter MacMahon and Scott Reid, a diary of forthcoming company announcements and networking events and video interviews with leading business experts covering a wide range of useful topics."